Internet Pharmacy Owner Charged in $95 Million Fraud Scheme

FOR IMMEDIATE RELEASE

June 14, 2012

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and David W. Bourne, Special Agent in Charge, Food and Drug Administration (FDA), Office of Criminal Investigation, Miami Field Office, announced the unsealing of an indictment charging defendant Andrew J. Strempler, 38, a Canadian citizen, with one count of conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349, and two counts of mail fraud, in violation of Title 18, United States Code, Section 1341. The government is also seeking forfeiture of $95 million.

Strempler made his initial appearance in federal court today before United States Magistrate Judge John O’Sullivan. If convicted, Stempler faces a possible maximum statutory sentence of up to 20 years in prison on each count.

According to the indictment, Strempler was the founder, owner and president of Mediplan Health Consulting, Inc., a Canadian company that also operated under the name RxNorth.com (RxNorth). RxNorth was an internet, mail and telephone order pharmacy, through which Strempler and others marketed and sold prescription drugs to residents of the United States.

The indictment alleges that the FDA advised Strempler in a 2001 letter that his prescription drug sales would be illegal in the United States if the drugs were not FDA approved. The FDA letter explained that the FDA approves drugs based on evidence that they are safe and effective, and that the quality of drugs from foreign sources could not be assured.

According to the indictment, from around January 2005 through June 9, 2006, Strempler and his co-conspirators unlawfully enriched themselves by selling prescription drugs to individuals in the United States, falsely representing that RxNorth was selling safe prescription drugs in compliance with regulations in Canada, the United Kingdom and/or the United States. The indictment further alleges that Strempler obtained the prescription drugs from various other source countries without properly ensuring the safety or authenticity of the drugs. In fact, the indictment alleges that some of the drugs sold by Strempler included counterfeit drugs.

U.S. Attorney Wifredo A. Ferrer stated, “FDA regulations are designed to promote and ensure the safety and integrity of prescription drugs sold and used in the United States. The U.S. Attorney’s Office is committed to assisting the FDA enforce these regulations to protect American consumers from unsafe, adulterated and counterfeit drugs.”

“The FDA-Office of Criminal Investigations is committed to aggressively pursuing individuals who seek to sell counterfeit, adulterated and misbranded pharmaceuticals to U.S. citizens via the Internet,” said David W. Bourne, Special Agent in Charge, FDA, Office of Criminal Investigation, Miami Field Office

Strempler caused prescription drugs from foreign countries to be shipped to a facility that Strempler operated in the Bahamas. Prescription orders made through RxNorth were then filled at the Bahamas facility, with labels on the vials and drug cartons stating they had been filled by RxNorth in Canada.

According to the indictment, Strempler used indirect routes involving multiple countries to ship packages with prescription drugs from the Bahamas to individuals in the United States. The indictment states that shipments mailed from the Bahamas, containing packages addressed to individuals in the Southern District of Florida, included counterfeit prescription drugs.

Mr. Ferrer commended the investigative efforts of the FDA-Office of Criminal Investigations. This case is being prosecuted by Assistant U.S. Attorney Ana Maria Martinez, and Roger Gural, Trial Attorney of the Department of Justice Consumer Protection Branch.

An indictment is only an accusation and a defendant is presumed innocent until proven guilty.